106 A. 690 | Md. | 1919
Augusta Stowman, a resident of Baltimore City, died leaving a last will and testament which was duly admitted to probate by the Orphans' Court of Baltimore City. After making certain specific bequests, she authorized and directed her executor, who is the appellee on this record, to sell all the rest and residue of her estate, and to divide the proceeds thereof among certain collateral relatives mentioned in the eighteenth item of her will. A portion of the residuary estate of the testatrix mentioned in that item of the will consisted of real estate in the State of Arkansas, which was sold by the executor under the power contained in the will. Upon this real estate, which was held in fee simple by the testatrix, the executor was required by the State of Arkansas to pay an inheritance tax. It is shown by the fourth account of the executor, filed in the Orphans' Court of Baltimore City, that the proceeds of the sale of the real estate situated in the State of Arkansas, amounted to $6,302.77. The State claimed that this sum, the proceeds of the Arkansas real estate, was liable to the collateral inheritance tax under the provisions of Article 81, § 120 of the Code. This claim was disputed by the executor, and suit was brought by the State and Howard W. Jackson, the Register of Wills of Baltimore City as agent of the State, for the recovery of the tax. To the declaration, which set forth the facts we have stated, the executor demurred, and the Court sustained the demurrer with leave to amend. The plaintiffs declined to amend, and judgment was entered in favor of the defendant for costs. From this judgment this appeal was taken.
The Statute (Article 81, § 120 of the Code) imposing a collateral inheritance tax provides that:
"All estates, real, personal and mixed, money, public and private securities for money of every kind passing from any person who may die seized and possessed thereof, being in this State * * * to any person or persons, bodies politic or corporate, in trust or otherwise, other than to or for the use of the father, mother, *351 husband, wife, children and lineal descendants of the grantor, bargainor, testator, donor or intestate, shall be subject to a tax of five per centum on every hundred dollars of the clear value of such estates, money or securities."
This statute has been considered by this Court in a number of cases (Tyson v. State,
In Fisher, Trustee, v. State,
The obligation of the executor to pay this tax must be determined as of the time of the death of Mrs. Stowman. Before that duty can be imposed, the Court must hold that the property was in legal contemplation in this State at the date of her death for, under the statute and authorities, it is only upon the transmission to collateral relatives of property situated in this State of which the deceased dies seized and possessed that the tax is imposed, or, as expressed in the statute, property "passing from any person who may die seized and possessed thereof, being in this State." It is not claimed, that if the Arkansas property owned by the testatrix at the time of her death were real estate, it would be subject to the tax, because the authorities are all agreed that the real estate of a resident decedent located in a foreign jurisdiction is not taxable. In reSwift Estate,
In re Swift's Estate,
In Connell v. Crosby,
The courts of Pennsylvania take a contrary view, but their holding is not in harmony with the authorities in other States and in England, and so far as we have been able to discover it is the only State in the Union which has applied the principle of equitable conversion in the law of succession taxation, and it did this, as appears in Re Handley's Estate, 181 Pa. St. 339: 37 A. 587, with some hesitation.
Our conclusion is that the real estate of Mrs. Stowman situated in Arkansas was not made subject to the collateral inheritance tax by the direction to sell contained in her will, and, being real estate owned by her at the time of her death and situated in a foreign jurisdiction, neither it nor the money realized from its sale is taxable under the law of this State. It follows from this holding that the judgment must be affirmed.
Judgment affirmed. *355